Our investment philosophy at J Stern & Co. builds on the tradition of the Stern family and its 60-year, multi-generational track record of investing for the long term. The family’s guiding principle as we have always highlighted is investing in quality and value, seeking long term real returns across economic and market cycles, based on our own in-house, independent research. Quality is the foremost requirement for the companies we invest in.
We define quality as investing in companies that participate in attractive industries, which hold leadership positions in those industries, and that have a strong and sustainable competitive advantage or a deep and enduring moat as Warren Buffett would say. Governance forms part of that definition. We look for strong management teams with a proven track record, engaged, independent boards and oversight structures that ensure shareholder interests are protected.
At the same time, we have always recognised that companies do not exist in a vacuum but are part of a nexus of environmental and social influences that mean that they are subject to a social licence to operate. We believe that it is critical for us to understand and incorporate this broader perspective in our analysis. Investing for the long term and across generations makes a social licence particularly important because it is founded in structural influences and regulatory and reputational risks that a more conventional financial analysis would not capture.
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